French auto group PSA Peugeot Citroen said today it would cut 8,000 jobs in its domestic operations as a sharp downturn in the European market led to a loss in the first quarter.

PSA, France's biggest carmaker and second in Europe to Germany's Volkswagen, said it expected the European market to shrink 8.0 percent this year and had to adjust its business in the face of a worsening outlook.